Google Parent Alphabet Just Delivered Great News for Nvidia Investors Worried About DeepSeek

Core Insights - Alphabet's Q4 2024 results showed a revenue increase of 12% year-over-year to $96.47 billion, with net income rising 38% and earnings per share up 31% to $2.15, but the stock fell around 8% due to lower-than-expected Google Cloud revenue growth [2][3] - Google Cloud revenue grew 30% to $12 billion, but analysts expected higher revenue of $96.56 billion, indicating a shortfall [2][3] - Alphabet plans to increase capital expenditures in Q1 2025 to between $16 billion and $18 billion, exceeding Wall Street expectations, primarily to expand cloud capacity [3][5] Nvidia's Position - Despite Alphabet's disappointing Q4 growth, there is a positive outlook for Nvidia as Google continues to rely on Nvidia's GPUs to meet AI demand, indicating a strong relationship between the two companies [4][6] - Alphabet's CEO noted that Google Cloud's revenue could have been higher if there was more capacity available, suggesting ongoing demand for Nvidia's products [4][6] - Concerns about the Chinese AI company DeepSeek's impact on Nvidia were downplayed by Alphabet's CEO, who emphasized that Google does not view DeepSeek as a significant threat [8] Future Outlook - Both Alphabet and Nvidia are expected to rebound from current challenges, with Alphabet's revenue growth anticipated to recover as cloud capacity increases, and fears regarding DeepSeek's disruption to Nvidia likely to diminish over time [11]